Irish opposition to EU plans to dramatically cut support for sugar beet growers was outlined in Brussels yesterday by the Minister for Agriculture and Food, Mr Walsh.
He told a meeting of EU farm ministers that the implication of the proposals on price and quota cuts, even allowing for compensation, would be to make sugar beet growing no longer viable in some member-states, including the Republic.
Its 3,800 beet growers would be expected to grow the crop with a one-third cut in the EU subsidy paid, even though the Commission said it would pay the farmers compensation.
It was estimated that the sugar beet growers would be paid compensation of €11 million in 2006, rising to €16 million in 2008, as the supports being paid from Brussels decreased.
The Minister, addressing the first farm ministers' meeting of the Dutch presidency, said that what was being proposed was devastating for the industry both at growing and processing level.
He pointed out that there were 1,000 jobs in the processing sector, which would also be placed at risk by the proposals in their current form.
The Finnish and Dutch governments are also opposing the proposals made last week by Dr Franz Fischler, the Agriculture and Rural Development Commissioner.
The issue was adjourned to the next meeting of farm ministers which will take place in September.
Dr Fischler said the reform of the sugar regime, which was set up in 1968, would strengthen the EU when it entered into the world trade talks later in the year.
Dr Fischler added that the reform of the sector would save the EU hundreds of millions of euros in subsidies.
However, he acknowledged that its implementation would put thousands of people out of work.
However, he said the current system in place was subject to fierce criticism not only from consumers but also from developing countries.
Under the Commission's proposals, the intervention price for sugar would be replaced by a reference price.
This would be set one third lower than the €632 per tonne now guaranteed to producers.
The lower price, which would be phased in over three years from July 2005, would still be twice the level of the prevailing world sugar price.
Sugar beet producers would receive compensation in the form of an annual direct payment.
Charities have been campaigning for a better trade deal for developing countries.
They complained that the Commission's latest proposals to reform the sugar beet industry would leave in place the EU subsidy system that disadvantaged sugar producers in poor countries.